Reporting from Dallas — J.C. Penney Co.'s board adopted a "poison pill" plan as it begins to build its defense against the still-unclear intentions of activist investor William Ackman's Pershing Square Capital Management and Vornado Realty Trust.
The plan will make it harder for any group to acquire control of the company.
Together, the investment firm and real estate investment trust said Oct. 8, they have acquired a combined 26% stake in the Plano, Texas, department store chain.
Ackman and management are meeting this week, according to a source close to the situation.
J.C. Penney confirmed Monday that it had hired Barclays Capital Inc. and Goldman, Sachs & Co. to be its financial advisors and Skadden, Arps, Slate, Meagher & Flom to give it legal advice.
Under the shareholder rights plan the company declared a dividend of one right to each outstanding share of J.C. Penney common stock. Each right allows for the purchase of a fraction of a share of J.C. Penney preferred stock. The rights expire in a year.
J.C. Penney said its board "is committed to acting in the best interests of all its stockholders" and adopted the rights plan in response to the "recent rapid accumulations of a significant percentage" of the company.
Ackman hasn't yet responded to J.C. Penney's move.
Halkias writes for the Dallas Morning News/McClatchy.